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The Bankruptcy Hotline

BY ALM Staff
March 29, 2006

Authorization to Enter Settlement Agreement Is a 'Final Order'

The Second Circuit has ruled that the order of a bankruptcy court approving a settlement agreement was a 'final order' under Federal Rule of Bankruptcy Procedure 9019, which triggered the 10-day period to file a notice of appeal. Ades-Berg Investors v. Breeden (In re The Bennett Funding Group Inc.), No. 05-1141 (Feb 24).

An equipment leasing company was sued by the SEC, which claimed the company was being operated as a Ponzi scheme, prompting the company to file a Chapter 11 petition. The trustee then filed an adversary action seeking the recovery of insurance proceeds from a company that insured the debtor against shortfalls in its lease collections. The lawsuit, which was transferred to the District Court for the Northern District of New York, named as defendants certain investors (the plaintiff here) and others claiming rights to the proceeds. This investor counterclaimed against the trustee, seeking the imposition of a constructive trust over the policy proceeds, and cross-claimed against the insurer.

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